Newsletter

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Dear Clients:

Once again, the New Year is fast approaching as well as another tax season shortly. 2025 changes that will be outlined at the end of this letter.

We are doing face-to-face consultations this year, but we are asking anyone that is not feeling well not to come into the office. An illness of any kind running through the office would create a disaster for the operations, especially during tax time. I am also doing face to face in Bethlehem, Pennsylvania on certain days. For some it might be an easier drive to Pennsylvania than Long Island.

There are also several virtual options. I have created a safe portal through a company called Smart Vault. When you contact me, I can send you an invitation to upload your information to that portal. If you did this last year, you still have the same access to that portal, and a 2025 folder should be there and accessible already. Here the office can retrieve the information and upon completion of the return, we can upload it to that file for safekeeping. Other ways to get me your tax information will be through mail services and email. You can also call and make an appointment to drop off during office hours, which are numerous during the season.

Before the end of the year, you can still optimize certain deductions which can decrease tax liabilities and provide tax savings.

In the meantime, it is very important to prepare for the upcoming tax filing to maximize all possible deductions which will allow for increased tax refunds. Some tax savings can still be accomplished this year by the following:

1. Contributing the maximum to 401K, 403B and IRA accounts
2. Off-setting any capital gains with capital losses
3. Contributing to 529 plans for college savings in certain states by December 31 (make sure that the plan you pick is deductible in that state and money must be in the account by December 31, so there is no time to waste)
4. Giving extra to charity
5. Contributing the maximum to HSA accounts
6. Paying off medical expenses for any possible medical deduction

Please also remember deadline filing dates are as follows:

• "S" Corporate Tax Deadline: March 16, 2026
• "C" Corporate Tax Deadline: April 15, 2026
• Personal Income Tax Deadline: April 15, 2026
• Partnership Tax Deadline (LLCs): March 16, 2026
• 1099 and W-2 submissions: February 2, 2026

If you cannot file by these dates, please notify us so that a proper extension can be filed. If there is a balance due on any return, it must be paid at the time of the extension to avoid incurring penalties and interest. There is no extension of time to pay only an extension for time to file a proper return.

If you need to go on extension the sooner, you tell us the better please.

Electronic filing is mandatory and the preferred method of filing because it achieves many benefits. Direct Deposit of refunds is also preferential because it stops the stealing of refunds from mailboxes or being lost in the mail. Please be aware that one of the many new scams in the world is stealing checks from mailboxes so whenever possible direct deposit is preferable. So please verify your routing number and account number when preparing the returns, both personal and business. (Deposit slips and bank cards do not have the proper information on them). We can use the bank information for payments as well. This is safer than mailing checks with all the personal information on it.

New York State and a few other states mandate using information from your Driver’s license or state identification information (front and back) for all titled taxpayers on the return. Unfortunately, the information does not carry through from last year and we will need to know current information for those of you whose license has expired or changed from the prior year. This is one way that NYS is trying to prevent fraud.

The following items must be obtained before your returns can be completed:

• All W-2s (final pay stubs will only be used for estimation purposes only)
• 1099’s, 1098’s, (interest income, mortgage interest, unemployment, college tuition)
• Social security numbers and dates of birth for all dependents. Without a social security number there will be NO deduction and certain credits will be limited as well.
• For dependent and child care deductions, the social security or employer identification number (TIN) and address for the person, school or business doing the caring. It is very important to have ALL information pertinent to allow the credit. You should be able to obtain this information at your child’s facility.
• Stock Transactions:  Year End Reports (1099s) provided by brokerage companies.  If you have a managed brokerage account, please have your realized gain/loss reports available as well. The brokerage houses have been mailing the statements later and also have been issuing many corrections to the original reports.  I don't expect this year to be different so be patient.
• Virtual Currency (Digital Assets): Year End Reports (1099’s) provided by brokerage companies. IRS wants to know if you purchased, gifted, or were awarded or sold or simply own any virtual currencies!
• All CLOSING STATEMENTS for purchases of real estate, sales of real estate, home equity loans or refinances. If you sold a property and have the original closing statement that would be helpful as well.
• If you take a home office deduction, please have available the total square footage of your home and the total square footage of the area used exclusively for your business. Please also have available the total of all utility bills (including water), normal repairs and maintenance, landscaping, home improvements, etc. as some of these expenses will be proportionately deductible against your income.
• If you take any mileage deductions for work or business, please have available the total mileage on the vehicle(s) for the year, amount which is commuting, that which is personal and the amount which is business. IRS wants to see the whole picture. Also, for verification purposes, make sure you have an odometer reading on an annual repair bill.

IMPORTANT ITEMS ESPECIALLY FOR 2025:
Individual concerns:

1. Unemployment statements – Either downloaded or mailed
2. Crypto Currency is a very hot topic as usual. Please make sure to notify us of all activities so we can keep you in compliance.
3. New York State and a few other states will be requiring accurate license information so I will need a picture of your licenses as stated above (front and back please).
4. Estate and Gift Tax Planning – 2025 allows a gift of $19,000 and will also apply to 2026. (This is not a tax deduction for the giver nor a taxable situation for the receiver. It is a way to reduce your taxable estate while you are alive and possibly avoid estate taxes in the future.)
5. Electric Vehicles and Charging Stations - please send receipts for all electric vehicles and charging stations so we can determine the appropriate credit (new and used). We must have VIN to match to IRS records which the car dealer provides to them.

1. Economic disaster loans:
   • Interest paid on the EID loans is tax deductible and must be specified on the return. This amount will be found on the SBA website.
2. Please send all items needed for preparation of 1099s in January. Have the recipients complete the W-9 and if we don’t do your bookkeeping send us the amount the recipient received during the year.

Precision Tax & Accounting Services Inc.
Rebecca J. Muller, Accountant & Enrolled Agent